Ekuinas buys majority stake in Malaysian tanker company

It one of two direct investments Ekuinas has made so far this year. The other is the purchase of a 60% stake in desserts and beverages maker CoolBlog for MYR50.8 million. Alongside commitments made through the firm's outsourced manager program, it takes the total capital invested by Ekuinas in 2014 to MYR450.1 million.

Founded in 2004 as a ship-broking business, Orkim transports CPP from refineries to oil storage terminals throughout the country. It has 11 vessels and an industry-leading market share of nearly 30%. Net profit came to MYR33.5 million for 2013 and revenue reached MYR136.4 million.

The deal is in line with Ekuinas' stategy of acquiring non-core assets from domestic government-linked and publicly-listed companies. While the Orkim's founders will retain a minority stake in the business, the majority owner - a subsidiary of Bank Pembangunan Malaysia - is making a full exit.

It also bolsters Ekuinas' oil and gas portfolio, which already includes oil and gas industry service provider Icon Offshore. Icon is Malaysia's third-largest offshore support vessel operator, with more than MYR1 billion in assets and a fleet of over 30 vessels. It was formed through the merger of two Ekuinas-owned units, Tanjung Kappal Services and ONMI Petromaritime.

"We are pleased with the investment in Orkim, which has a strong management and demonstrates a strong track record of growth. It also facilitates Ekuinas' entry into the petroleum transportation industry which has favorable industry growth dynamics, especially in liquefied petroleum gas transportation, an area that is currently dominated by foreign companies," Raja Tan Sri Dato' Seri Arshad Raja Tun Uda, chairman of Ekuinas, said in a statement.

The investment in CoolBlog comes through Ekuinas' retail food and beverage arm, Integrated Food Group. It also owns the Burger King franchise for Singapore and most of the Malaysian peninsula, the Malaysia franchises for San Francisco Coffee and Tony Roma's, the Malaysia and Singapore franchises for Popeyes, and Manhattan Fish Market.

Founded in 2007, CoolBlog sells take-away desserts and beverages from street stalls and kiosks, operating under a licensee model. It has 299 outlets in Malaysia and recently expanded into Indonesia. It reported a net profit of MYR8.47 million for 2013, with revenue of MYR42.52 million.

Ekuinas sees the investment as a means of creating a sustainable income for small-scale entrepreneurs, particularly those from the Bumiputera ethnic group.

Under the outsourced manager program, Ekuinas also contributed MYR32 million to two new investments made by CIMB Private Equity and Asiasons Private Equity, respectively. It announced last year that LP commitments would be made to five local private equity firms as part of the second tranche of the outsourcing program.

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• Topics
• Southeast Asia
• Consumer
• Industrials
• Buyouts
• Southeast Asia
• Malaysia
• Ekuinas
• buyout
• Transportation
• Commodities
• Consumer